Trading the Bitcoin Calendar Spread

The calendar spread is a useful gauge of how bullish or bearish traders are in a forward starting-time period. In early February, Bitcoin lost close to 70% of its value measured against its December 2017 all-time high. The spread reached a low of 0.42% annualized during the same period.

The source for this analysis is BitMEX► BitMEX Crypto Exchange

Chart: March (XBTH18) and June (XBTM18) Bitcoin/USD contract spread

Bitcoin Calendar Spread

Source: BitMEX

The above chart shows the Bitcoin price and the annualized premium of the March (XBTH18) and June (XBTM18) Bitcoin/USD contract spread.

The calendar spread is calculated by the following function:

Annualised Premium = [(XBTM18 Price - XBTH18 Price) / Bitcoin Spot] / 0.2493

0.2493 represents the annualized time value between the March and June expiry dates.

Bitcoin Trade Signal -February 2018

Bitcoin is trading at very crucial levels. BTC/USD trades at $9.250 near the key resistance levels $9.250-$9.500. If the Bitcoin/USD price manages to cross above $9.500 then we should expect a quick move to $10.200-$10.300

  • Target-1: $9.480
  • Target-2: $10.200-$10.300
  • Target-3: $11.600-$11.800

Chart: Bitcoin/USD (H4)

Bitcoin/USD (H4)

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■ Bitcoin Trade Signal -February 2018

ExpertSignal.com

Brad Garlinghouse "Most cryptocurrencies will lose all of their value"

at Goldman Sachs' Technology and Internet Conference

Key Points:

  • Long-term value will be dictated by the utility of each coin
  • Most cryptocurrencies will lose all of their value, as these coins are simply not very useful as a transactional currency
  • Some have criticized Ripple for holding the majority of XRP in company reserves
  • Garlinghouse said Bitcoin — which he says is 1000 times slower and more expensive than XRP — will still be used as a store of value, similar to gold

Speaking to an audience of analysts at the Goldman Sachs' Technology and Internet Conference, Garlinghouse (Ripple CEO) said he believes "most" cryptocurrencies will eventually lose all of their value. In short, he believes that most of these coins are simply not very useful as a transactional currency, meaning there's no reason for them to exist.

"It's not clear what the use case is. It's not clear the what value proposition is," he told the audience. "Long-term value will be dictated by the utility of that asset."

Though Garlinghouse's stance may seem rigid for someone whose company has come into prominence thanks to the recent crypto-craze, he hasn't written off all digital currencies.

Garlinghouse gave nod to the idea that bitcoin — which he says is 1000 times slower and more expensive than XRP — will still be used as a store of value, similar to the role that gold has played for. But it won't be used for payments, in his opinion.

"Bitcoin is going to solve a different problem," he said.